It is possible to get your wages in btc. Its possible to pay your bills in btc. Its possible to buy many day to day items with btc...
The loop is there, it is difficult to do it day to day, sure. But you can say that about many currencies.

If i gave an American some swiss francs or Japanese yen it would be awkward to use it in 'the loop' you describe, but  not impossible - they are still currencies.